Ford Motor Company

Ford keeps raising its profit outlook while selling roughly the same number of vehicles, with richer trucks, off-road trims and paid services doing the work. The test is whether that holds while it pays for models and businesses that do not earn yet. How much of the profit increase comes from pricing versus cost cuts?

• Ford now earns more per vehicle, not from selling more vehicles.

  Each of the last three reports raised the profit outlook, now $10 billion to $11 billion, on flat-to-lower revenue. Richer truck and off-road mix plus lower warranty and material costs carry it, so profit no longer depends on volume.

• Software and parts are becoming a second profit engine.

  Software and physical services are a $15 billion business management expects to grow about 8% a year, and paid subscriptions rose by half in the latest quarter. These are repeat, high-margin purchases that hold up when vehicle sales fall.

• The second half of the year is where the bills arrive.

  Commodity costs are about $1 billion worse than planned, and that lands with launch spending on the UEV pickup and Ford Energy, so the strong first half is not the run rate. Which costs hit the second half hardest?